Extension To Restrictions On Forfeiture of Business Tenancies for Non-payment of Rent and Commercial Rent Arrears Recovery

Due to the Coronavirus pandemic restrictions were implemented earlier in 2020 preventing the forfeiture of business tenancies and leases. These restrictions were due to expire on 31 December 2020.

However, on 30 December 2020 the restrictions, specifically preventing forfeiture of business tenancies for non-payment of rent in England, were extended until 31 March 2021. The same also came into force for Wales on 31 December 2020.

This means that where non-payment of rent would usually allow a landlord to forfeit a lease, that right cannot be exercised until the end of the restrictions.

Additionally, the restrictions on the use of commercial rent arrears recovery (‘CRAR’) has also been extended meaning this is not permissible until 31 March 2021. Accordingly, until 31 March 2021, the minimum amount of net unpaid rent that must be outstanding before commercial rent arrears recovery may take place is:

• From 29 September 2020 until 24 December 2020 (inclusive), 276 days’ rent
• From 25 December 2020, 366 days’ rent.

If you are a landlord owner of commercial premises we are well placed to assist you, including in the coronavirus pandemic. Although there are restrictions on both forfeiture as above and winding up (see here), there are other options including pursuing claims for judgment, and pursuing guarantors. We advise and assist landlords, investors, and managing agents nationally on these issues and will continue to provide updates as the position develops.

Team at Helix Law

LinkedIn: https://www.linkedin.com/company/helixlaw

Email: [email protected]